eMedia plunges into R1.6bn loss, complaining of unfair competition
TV broadcaster eMedia plunged into a loss of R1.6bn in its 2018 financial year from a small profit of R160m in the prior year.
eMedia complained that its free-to-air channel e.tv faced unfair competition from state-owned broadcaster SABC because it produces local content subsidised by taxpayers. The group said e.tv’s audience was falling "due to the popularity of local dramas commissioned by the SABC".
"While the SABC commissions a substantial amount of local programming, at much higher cost than equivalent international content, our ability to commission additional local drama is limited by our production budget and profitability," the results statement said.
The results included a R69m one-off write down of e.tv’s movie inventory.
Within the pay-TV market, eMedia complained its eNCA service was suffering from its dependence on competitor Naspers’s subsidiary MultiChoice.
"The results were also impacted by the new MultiChoice agreement with eMedia Investments. In this regard, licence-fee revenue was cut substantially in the current year."
eMedia is attempting to develop an alternative to MultiChoice called OpenView. "OpenView currently attracts about 3.5% of the TV audience in SA and break-even is estimated to be in the region of 6%," eMedia said.
Despite the squeeze on e.tv from the SABC and eNCA from MultiChoice, eMedia managed to limit its fall in revenue to 5%, taking it to R2.2bn for the year to end-March.